Court: City can reduce health benefits of retirees

The First District Court of Appeals has ruled that retired employees for the City of Cincinnati who had their health benefits reduced are not entitled to have them reinstated by court order.

A three-member panel unanimously upheld the decision by the Hamilton County Court of Common Pleas.

The Cincinnati Retirement System was established by city ordinance in 1931 and currently serves about 5,000 retirees, disability retirees, and survivors. Medical benefits were added to the system later.

In 2009, facing financial difficulties the Cincinnati City Council enacted legislative changes to the health care benefits that added a $200 deductible and increased out-of-pocket caps on certain expenses effective January 1, 2010. A group of retirees affected by the changes filed a class-action lawsuit in the Hamilton County Court of Common Pleas. The trial court ruled in favor of the city.

That decision was upheld by the First District this week in an opinion that recognized that the city retirement office had led the retirees to believe that their health care benefits could not be altered, but nonetheless found that city was not legally obligated to maintain retirees' health benefits at a specific level.

"We are not unsympathetic to the plaintiffs-appellants' position," the court wrote. "The information about the so-called permanence of the retirees' healthcare benefits was, in this record, shown to be repeatedly, clearly, and fully disseminated by city employees in the city's retirement office. And the city's leaders and city mangers— those same city leaders and managers who had worked with these retirees on a daily basis—did nothing to correct the plaintiffs-appellants' misconception about the unalterability of their healthcare benefits."

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